Alibaba Group updated its registration statement yesterday to include first quarter financial results, and while a slowdown in revenue growth startled Yahoo! Inc. (NASDAQ:YHOO) investors, there’s still plenty of reason for the rest of the market to be excited about the upcoming IPO.
Revenue drops as mobile makes up a larger mix of total volume
The biggest potential worry is that revenue growth fell to 38.7% year-on-year in the first quarter, well below the 61.7% year-on-year growth the previous quarter. Seasonal effects likely play a role, but even if the growth rate stays in the 30s from here on out, that’s still an incredible rate. Gross merchandise volume (GMV) fell to 46.3% annual growth from 52.9% the previous quarter, reflecting a higher mix of mobile which monetization rates two-thirds lower than desktop.